Hostess Brands

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Hostess Brands, Inc.

Type	Private
Founded	1930
Headquarters	Dallas, Texas, USA
Key people	Craig D. Jung, CEO
Industry	Retail
Products	Brands such as Wonder Bread, Hostess, and Dolly Madison
Revenue	$2.798 billion USD (2008)[1]
Net income	-$143.68million USD (2008)
Total equity	-$461.71million USD (2008)
Employees	20,000
Website	www.interstatebakeriescorp.com

Hostess Brands, Inc. (formerly Interstate Bakeries Corporation (IBC)) is the largest wholesale baker and distributor of fresh bakery products in the United States, and is the owner of the Hostess, Wonder Bread, Dolly Madison, Butternut Breads, and Drake's brands. For many years it was based at 12 East Armour Boulevard, Kansas City, Missouri. After it emerged from bankruptcy in 2009 it moved to Irving, Texas.^[2]

Contents 1 History 1.1 Interstate Brands 1.2 DPF 1.3 Interstate Bakeries 1.4 IBC Holdings 1.5 Interstate Bakeries 1.5.1 Continental Baking Merger 1.5.2 Bankruptcy 1.5.3 Hostess Brands, Inc. 2 The Brands of Interstate Bakeries Corporation 3 Other Brands Manufactured by IBC 4 References 5 External links

[edit] History

Ralph Leroy Nafziger founded Interestate in 1930 in Kansas City as a wholesaler selling bread loaves wrapped in gingham wrapping to grocery stores. In 1937 Interstate merged with the Chicago baker Schulze Baking Company.^[3]

In 1943 it acquired Supreme Baking Company in Los Angeles. In 1950 it bought O'Rourke Baking Company of Buffalo, New York.

In the 1950s and early 1960s purchases included Ambrosia Cake Company, the Remar Baking Company, the Butter Cream Baking Company, Campbell-Sell Baking Company, the Kingston Cake Bakery, Cobb's Sunlit Bakery, Schall Tasty Baking Company, Sweetheart Bread Company, and Hart's Bakeries.^[4]

[edit] Interstate Brands

In the late 1960s it acquired Millbrook Bread, Baker Canning Company, Shawano Farms, Inc. and the Shawano Canning Company.

In 1969 it changed its name to Interstate Brands. Its signature brands were Butternut and Blue Seal breads, and Dolly Madison cakes.

[edit] DPF

In 1975 it was acquired by Data Processing Financial and General Corporation, a computer leasing company, after computer systems leased from the DPF&G turned out to be expensive and obsolete when IBM changed its pricing structure (which in turn would draw IBM into antitrust battles) The name was changed to DPF and the headquarters moved to Hartsdale, New York. DPF saw its stock crash in the computer fiasco and told Barrons magazine they were looking for a low tech business which could withstand any recessions because people in recessions wanted to eat sweets. DPF acquired Silver Loaf Baking Company, Eddy Bakeries, and Mrs. Cubbison's Foods, Inc. ^[5]

[edit] Interstate Bakeries

In 1981 DPF completed the sale of its remaining computer systems and renamed the company back to its original Interstate Bakeries and moved its headquarters back to Kansas City.

In 1986 it acquired Purity Baking Company and Stewart Sandwiches followed in 1987 by Landshire Food Products.

[edit] IBC Holdings

In 1987 management took the company private and it bought the Merita/Cotton's Bakeries division of the American Bakeries Company.

[edit] Interstate Bakeries

In 1991 the company changed back to Interstate Bakeries and went public again.

[edit] Continental Baking Merger

In January 1995,it acquired Continental Baking Company, for $330 million and 16.9 million shares of Interstate stock from Ralston Purina. It bought San Francisco French Bread Company, John J. Nissen Baking Company , Drake's, and My Bread Company.^[6]

Under Ex-Merita Baking head, Charles Sullivan, Butternut and Wonder Bread operated with different cultures: Butternut was seat-of-the-pants, with each bakery a self-contained profit center; Wonder Bread was very "procedural and by-the-book." This caused some problems early on. In both cultures, snack cakes were more profitable due to economy of scale and logistics. When extended-shelf-life enzymes were developed for bread, the hope was to convert the system of many small inefficient bakeries into an efficient network of a relatively few giant bakeries like their snackcakes operation. Bad luck intervened; the old resurrected Atkin's diet and Krispy Kreme doughnuts affected pricing and sales volume.

[edit] Bankruptcy

On September 22, 2004, Interstate Bakeries filed for chapter 11 bankruptcy. The company also named a new chief executive. James R. Elsessor, who had taken over as CEO for Charles Sullivan, was replaced by Tony Alvarez. Interstate Bakery's stock, which had been at one time $34/share, fell to $2.05/share as they declared bankruptcy. At the time it was the longest bankruptcy in US history.

The company emerged from bankruptcy as a private company on February 3, 2009.^[7]. The plan included a 50 percent equity stake by Ripplewood Holdings and lines/loans by General Electric Capital and GE Capital Markets, Silver Point Finance and Monarch Master Funding. Interstate's union workers have made concessions in exchange for equity. ^[8]

Since declaring bankrupty Interstate closed nine of it 54 bakeries and more than 300 outlet stores and sliced its work force from 32,000 to 22,000 and pulled out of some markets including Los Angeles where it no longer sells bread.^[9]

[edit] Hostess Brands, Inc.

Effective November 2, 2009, the company was renamed Hostess Brands, Inc.^[10]

[edit] The Brands of Interstate Bakeries Corporation

In the United States, these include:

Baker's Inn Beefsteak Blue Ribbon Bread du Jour Butternut Breads Colombo Cotton’s Di Carlo

Drake's Dolly Madison Dutch Hearth Eddy’s Home Pride Hostess J.J. Nissen

Merita Millbrook Mrs. Cubbison’s Parisian Standish Farms Sweetheart Wonder Bread

[edit] Other Brands Manufactured by IBC

Marie Callender’s Holsum

Sun-Maid Roman Meal

[edit] References

[edit] External links

• Interstate Bakeries corporate website